Aktis Oncology, Inc.

Previous wording

You should read the following discussion and analysis of our financial condition and results of operations together with our condensed consolidated financial statements and related notes appearing elsewhere in this Quarterly Report and our Annual Report on Form 10-K for the year ended December 31, 2025, which was filed with the Securities and Exchange Commission ("SEC") on March 30, 2026 (the "Annual Report"). Some of the information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report on Form 10-Q, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. As a result of many factors, including those factors set forth in the “Risk Factors” section of this Quarterly Report on Form 10-Q and the “Risk Factor” section of our Annual Report -K, our actual results could differ materially from the results described in, or implied by, these forward-looking statements.

Current wording

You should read the following discussion and analysis of our financial condition and results of operations together with our condensed consolidated financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q (the "Quarterly Report") and our Annual Report on Form 10-K for the year ended December 31, 2025, which was filed with the Securities and Exchange Commission (the "SEC") on March 30, 2026 (the "Annual Report"). Some of the information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. As a result of many factors, including those factors set forth in the “Risk Factors” section of this Quarterly Report and the “Risk Factors” section of our Annual Report, our actual results could differ materially from the results described in, or implied by, these forward-looking statements.

Previous wording

We are a clinical-stage oncology company focused on expanding the breakthrough potential of targeted radiopharmaceuticals to large patient populations, including those not addressed by existing platform technologies. The field of targeted radiopharmaceuticals is currently led by two marketed products that illustrated transformative survival outcomes and quality of life benefits can be conferred by delivering radioisotopes to solid tumors. These leading products, which target prostate specific membrane antigen or somatostatin-2 receptor, are each currently approved in only one tumor type, but in those indications, have seen considerable commercial uptake and have become fundamental pillars of cancer treatment. Despite these advances, we believe that the field of radiopharmaceuticals is still in its infancy, with many emerging companies still primarily focused on these same two targets. In contrast, we see a significant opportunity to broaden the cancer patient populations benefiting from targeted radiopharmaceuticals by developing next-generation technologies that expand the scope of tumor targets for which it is possible to safely deliver a powerful payload of an alpha-emitting radioisotope. To ensure patient demand is reliably met, we are also establishing efficient end-to-end supply, with a combination of critical internal capabilities paired with experienced external vendors. Through these efforts, we seek to maximize clinical utility across multiple indications in multiple tumor types, and to expand the commercial uptake of radiopharmaceuticals beyond the traditional nuclear medicine setting and into the more expansive clinical oncology setting.

Current wording

We are a clinical-stage oncology company focused on expanding the breakthrough potential of targeted radiopharmaceuticals to large patient populations, including those not addressed by existing platform technologies. The field of targeted radiopharmaceuticals is currently led by two marketed products that illustrated that transformative survival outcomes and quality-of-life benefits can be conferred by delivering radioisotopes to solid tumors. These leading products, which target prostate-specific membrane antigen or somatostatin-2 receptor, are each currently approved in only one tumor type, but in those indications, have seen considerable commercial uptake and have become fundamental pillars of cancer treatment. Despite these advances, we believe that the field of radiopharmaceuticals is still in its infancy, with many emerging companies still primarily focused on these same two targets. In contrast, we see a significant opportunity to broaden the cancer patient populations benefiting from targeted radiopharmaceuticals by developing next-generation technologies that expand the scope of tumor targets for which it is possible to safely deliver a powerful payload of an alpha-emitting radioisotope. To ensure patient demand is reliably met, we are also establishing efficient end-to-end supply, with a combination of critical internal capabilities paired with experienced external vendors. Through these efforts, we seek to maximize clinical utility across multiple indications in multiple tumor types, and to expand the commercial uptake of radiopharmaceuticals beyond the traditional nuclear medicine setting and into the more expansive clinical oncology setting.

Previous wording

Since our inception in August 2020, we have devoted substantially all of our resources to developing our miniprotein radioconjugate platform, identifying and developing our product candidates and programs, establishing and protecting our intellectual property, conducting research and development activities, building our supply chain and manufacturing capabilities, organizing and staffing our company, raising capital and providing general and administrative support for these operations. We do not have any products approved for commercial sale and have not generated any revenues from product sales. We have funded our operations primarily with proceeds the issuance and sale of our redeemable convertible preferred stock and upfront payments from a Research and Collaboration Agreement, the Collaboration Agreement, with Eli Lilly and Company, or Eli Lilly, and have received aggregate net proceeds of $345.5 million from the sale of our redeemable convertible preferred stock, $60.0 million in upfront payments upon entering into the Collaboration Agreement, and $1.0 million upon achieving the first development milestone under the Collaboration Agreement. In January 2026, we completed our IPO of 20,297,500 shares of common stock, which included 2,647,500 shares of common stock sold pursuant to the underwriters' full exercise of their option to purchase additional shares. We received net proceeds from the IPO of $334.4 million after deducting underwriter discounts, commissions and other offering expenses incurred through March 31, 2026.

Current wording

Since our inception in August 2020, we have devoted substantially all of our resources to developing our miniprotein radioconjugate platform, identifying and developing our product candidates and programs, establishing and protecting our intellectual property, conducting research and development activities, building our supply chain and manufacturing capabilities, organizing and staffing our company, raising capital and providing general and administrative support for these operations. We do not have any products approved for commercial sale and have not generated any revenues from product sales. We have funded our operations primarily with proceeds from the issuance and sale of our redeemable convertible preferred stock and upfront payments from a Research and Collaboration Agreement, the Collaboration Agreement, with Eli Lilly and Company, or Eli Lilly, and have received aggregate net proceeds of $345.5 million from the sale of our redeemable convertible preferred stock, $60.0 million in upfront payments upon entering into the Collaboration Agreement, and $1.0 million upon achieving the first development milestone under the Collaboration Agreement. In January 2026, we completed our IPO of 20,297,500 shares of common stock, which included 2,647,500 shares of common stock sold pursuant to the underwriters' full exercise of their option to purchase additional shares. We received net proceeds from the IPO of $334.4 million after deducting underwriter discounts, commissions and other offering expenses.

Previous wording

We have incurred significant operating losses in every year since inception and we expect to continue to incur substantial losses for the foreseeable future. Our ability to generate revenue sufficient to achieve profitability will depend heavily on the successful development and eventual commercialization of one or more of our product candidates. As of March 31, 2026, we had an accumulated deficit of $174.9 million and our net losses were $18.3 million and $15.0 million for the three months ended March 31, 2026 and 2025, respectively. We expect our expenses and operating losses will increase substantially as we:

Current wording

We have incurred significant operating losses in every year since inception and we expect to continue to incur substantial losses for the foreseeable future. Our ability to generate revenue sufficient to achieve profitability will depend heavily on the successful development and eventual commercialization of one or more of our product candidates. As of June 30, 2026, we had an accumulated deficit of $199.0 million and our net losses were $42.5 million and $33.1 million for the six months ended June 30, 2026 and 2025, respectively. We expect our expenses and operating losses will increase substantially as we:

Previous wording

commence clinical trials for [225 Ac]Ac-AKY-2519 for B7-H3 expressing tumors;

Current wording

advance [225 Ac]Ac-AKY-1189 for Nectin-4 expressing tumors and [225 Ac]Ac-AKY-2519 for B7-H3 expressing tumors through clinical trials;

Previous wording

continue IND-enabling preclinical studies for our other programs;

Current wording

continue investigational new drug, or IND, -enabling preclinical studies for our other programs;

Previous wording

As of March 31, 2026, we had cash, cash equivalents and marketable securities of $538.5 million. Based upon our current operating plans, we believe our existing cash, cash equivalents and marketable securities will be sufficient to fund our operations into 2029. We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect. See the sections titled “—Liquidity and capital resources” and “Risk factors” included elsewhere in this Quarterly Report.

Current wording

As of June 30, 2026, we had cash, cash equivalents, and marketable securities of $517.3 million. Based upon our current operating plans, we believe our existing cash, cash equivalents, and marketable securities will be sufficient to fund our operations into 2029. We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect. See the sections titled “—Liquidity and capital resources” and “Risk Factors” included elsewhere in this Quarterly Report.

Previous wording

Since our inception, we have not recorded any income tax benefits or expense for the net losses we have incurred in each period or for our earned research and development tax credits, as we believe, based upon the weight of available evidence, that it is more likely than not that all of our net operating loss carryforwards and tax credits will not be realized. As of December 31, 2025, we had net operating loss carryforwards, or NOLs, for federal and state income tax purposes of $45.8 million and $40.8 million, respectively. The federal NOLs are not subject to expiration and the state NOLs begin to expire in 2041. These loss carryforwards are available to reduce future federal taxable income, if any. As of the three months ended March 31, 2026 and 2025, we have recorded a full valuation allowance against our net deferred tax assets.

Current wording

Since our inception, we have not recorded any income tax benefits or expense for the net losses we have incurred in each period or for our earned research and development tax credits, as we believe, based upon the weight of available evidence, that it is more likely than not that all of our net operating loss carryforwards and tax credits will not be realized. As of December 31, 2025, we had net operating loss carryforwards, or NOLs, for federal and state income tax purposes of $45.8 million and $40.8 million, respectively. The federal NOLs are not subject to expiration and the state NOLs begin to expire in 2041. These loss carryforwards are available to reduce future federal taxable income, if any. As of the three and six months ended June 30, 2026 and 2025, we have recorded a full valuation allowance against our net deferred tax assets.

Previous wording

Collaboration revenue was $3.2 million and $1.4 million for the three months ended March 31, 2026 and 2025, respectively, driven by revenue recognized from our Collaboration Agreement with Eli Lilly, which is recognized over time using the cost incurred input method.

Current wording

Collaboration revenue was $3.4 million and $1.6 million for the three months ended June 30, 2026 and 2025, respectively, driven by revenue recognized from our Collaboration Agreement with Eli Lilly, which is recognized over time using the cost incurred input method.

Previous wording

$0.8 million increase in direct costs for [225 Ac]Ac-AKY-1189 related to the ongoing operations of our Phase 1b clinical trial for this program; and

Current wording

$3.6 million increase related to the operations of our ongoing Phase 1b clinical trial for [225 Ac]Ac-AKY-1189;

Previous wording

$2.2 million increase in direct costs associated with advancing [225 Ac]Ac-AKY-2519 through IND-enabling studies;

Current wording

$2.5 million increase associated with advancing [225 Ac]Ac-AKY-2519 through IND-enabling studies and into clinical trials;

Previous wording

$2.1 million increase primarily driven by an increase in employee-related costs (including stock-based compensation) attributable to our increased headcount to support the advancement of our clinical development programs and manufacturing;

Current wording

$2.0 million increase primarily driven by an increase in employee-related costs (including stock-based compensation) attributable to our increased headcount to support the advancement of our clinical development programs and manufacturing; and

Previous wording

$0.2 million increase in facility, lab and depreciation costs primarily related to an increase in laboratory equipment as a result of our expansion of laboratory space and an increase in software subscriptions, partially offset by;

Current wording

$0.5 million increase in facility, lab and depreciation costs primarily related to an increase in laboratory equipment as a result of our expansion of laboratory space and an increase in software subscriptions, partially offset by;

Previous wording

General and administrative expenses were $5.9 million for the three months ended March 31, 2026, compared to $3.7 million for the comparable prior year period. The increase of $2.2 million was primarily due to an increase in employee-related costs (including stock-based compensation) attributable to our increased headcount, as well as higher professional and consulting costs and director and officer insurance costs associated with operating as a public company.

Current wording

General and administrative expenses were $7.0 million for the three months ended June 30, 2026, compared to $3.9 million for the comparable prior year period. The increase of $3.1 million was primarily due to an increase in employee-related costs (including stock-based compensation) attributable to our increased headcount, as well as higher professional and consulting costs and director and officer insurance costs associated with operating as a public company.

Previous wording

Other income, net was $4.4 million for the three months ended March 31, 2026, compared to $3.2 million for the comparable prior year period. The increase of $1.2 million was primarily driven by an increase in interest income earned due to higher average balances in cash equivalents and marketable securities in the three months ended March 31, 2026 compared to the three months ended March 31, 2025.

Current wording

Other income, net was $4.8 million for the three months ended June 30, 2026, compared to $2.9 million for the comparable prior year period. The increase of $1.9 million was primarily driven by an increase in interest income earned due to higher average balances in cash equivalents and marketable securities during the three months ended June 30, 2026 compared to the comparable prior year period.

Previous wording

Since our inception, we have incurred significant operating losses. We have not generated any revenue from product sales and we do not expect to generate revenue from sales of products in the near term, if at all. We expect to incur significant expenses and operating losses for the foreseeable future as we advance our product candidates into and through clinical development and as we continue to develop additional product candidates. As such, we expect our research and development and general and administrative costs to continue to increase significantly, including the costs associated with operating as a public company. As a result, we will need additional capital to fund our operations, which we may obtain from additional equity or debt financings or strategic agreements.

Current wording

Since our inception, we have incurred significant operating losses. We have not generated any revenue from product sales and we do not expect to generate revenue from sales of products in the near term, if at all. We expect to incur significant expenses and operating losses for the foreseeable future as we advance our product candidates into and through clinical development and as we continue to develop additional product candidates. As such, we expect our research and development and general and administrative expenses to continue to increase significantly, including the costs associated with operating as a public company. As a result, we will need additional capital to fund our operations, which we may obtain from additional equity or debt financings or strategic agreements.

Previous wording

In January 2026, we raised aggregate net proceeds of $334.4 million, after deducting underwriter discounts, commissions and other offering expenses incurred through March 31, 2026, from the sale of shares of common stock in our initial public offering. As of March 31, 2026, we had cash, cash equivalents and marketable securities of $538.5 million.

Current wording

In January 2026, we raised aggregate net proceeds of $334.4 million from the sale of shares of common stock in our initial public offering, after deducting underwriter discounts, commissions and other offering costs. As of June 30, 2026, we had cash, cash equivalents, and marketable securities of $517.3 million.

Previous wording

Net cash used in operating activities was $24.2 million for the three months ended March 31, 2026, primarily consisting of our net loss of $18.3 million and net changes in operating assets and liabilities of $9.1 million, offset by non-cash charges of $3.2 million related to accretion of investment discounts, stock-based compensation and depreciation.

Current wording

Net cash used in operating activities was $44.8 million for the six months ended June 30, 2026, primarily consisting of our net loss of $42.5 million and net changes in operating assets and liabilities of $8.6 million, offset by non-cash charges of $6.2 million related to accretion of investment discounts, stock-based compensation and depreciation.

Previous wording

Net cash used in operating activities was $17.5 million for three months ended March 31, 2025, primarily consisting of our net loss of $15.0 million, changes in operating assets and liabilities of $2.4 million, and $0.1 million of non-cash charges related to stock-based compensation, depreciation, and accretion of investment discounts.

Current wording

Net cash used in operating activities was $33.7 million for the six months ended June 30, 2025, primarily consisting of our net loss of $33.1 million, changes in operating assets and liabilities of $1.2 million, offset by non-cash charges of $0.6 million related to accretion of investment discounts, stock-based compensation and depreciation.

Previous wording

Net cash provided by investing activities was $20.5 million for the three months ended March 31, 2026, primarily consisting of maturities of marketable securities of $22.4 million, partially offset by purchases of property and equipment of $1.9 million.

Current wording

Net cash used in investing activities was $248.2 million for the six months ended June 30, 2026, primarily consisting of purchases of marketable securities and property and equipment of $300.4 million and $3.1 million, respectively, partially offset by the maturities of marketable securities of $55.4 million.

Previous wording

Net cash provided by investing activities was $39.0 million for the three months ended March 31, 2025, primarily consisting of maturities of marketable securities of $51.7 million, partially offset by purchases of marketable securities and property and equipment of $10.8 million and $1.9 million, respectively.

Current wording

Net cash provided by investing activities was $107.2 million for the six months ended June 30, 2025, primarily consisting of maturities of marketable securities of $121.4 million, partially offset by purchases of marketable securities and property and equipment of $10.8 million and $3.4 million, respectively.

Previous wording

Net cash provided by financing activities was $337.5 million for the three months ended March 31, 2026, primarily consisting of gross proceeds from the IPO of $339.8 million partially offset by payment of offering costs of $2.3 million.

Current wording

Net cash provided by financing activities was $337.7 million for the six months ended June 30, 2026, primarily consisting of net proceeds from the IPO of $339.8 million, partially offset by payment of offering costs of $2.3 million.

Previous wording

Net cash used in financing activities was $0.5 million for the three months ended March 31, 2025, primarily consisting of payments of offering costs of $0.5 million.

Current wording

Net cash used in financing activities was $0.5 million for the six months ended June 30, 2025, primarily consisting of payments of offering costs of $0.5 million.

Previous wording

As of March 31, 2026, we had cash, cash equivalents and marketable securities of $538.5 million. Based upon our current operating plans, we believe that our existing cash, cash equivalents and marketable securities, will be sufficient to fund our operations into 2029. We have based this estimate on assumptions that may prove to be wrong, and we could expend our capital resources sooner than we expect.

Current wording

As of June 30, 2026, we had cash, cash equivalents, and marketable securities of $517.3 million. Based upon our current operating plans, we believe that our existing cash, cash equivalents, and marketable securities, will be sufficient to fund our operations into 2029. We have based this estimate on assumptions that may prove to be wrong, and we could expend our capital resources sooner than we expect.

Previous wording

the scope, progress, results and costs related to the clinical development of [225 Ac]Ac-AKY-1189 for Nectin-4 expressing tumors;

Current wording

the scope, progress, results and costs related to the clinical development of [225 Ac]Ac-AKY-1189 for Nectin-4 expressing tumors and [225 Ac]Ac-AKY-2519 for B7-H3 expressing tumors;

Previous wording

the costs of establishing or contracting for sales and marketing capabilities if we obtain regulatory clearances to market [225 Ac]Ac-AKY-1189 for any Nectin-4 expressing tumors or any future product candidates.

Current wording

the costs of establishing or contracting for sales and marketing capabilities if we obtain regulatory clearances to market any of our current or future product candidates.

Previous wording

As of March 31, 2026, we had future minimum operating lease payment obligations under non-cancellable leases of $16.1 million related to leases we have recognized on our consolidated balance sheets, which are due over the following 6.54 years.

Current wording

As of June 30, 2026, we had future minimum operating lease payment obligations under non-cancellable leases of $15.5 million related to leases we have recognized on our consolidated balance sheet, which are due over the following 6.33 years.

Previous wording

We are also a “smaller reporting company” as defined in the Exchange Act. We may continue to be a smaller reporting company even after we are no longer an emerging growth company. We may take advantage of certain of the scaled disclosures available to smaller reporting companies until for so long as either (i) our voting and non-voting common stock held by non-affiliates is less than $250.0 million measured on the last business day of our second fiscal quarter, or (ii) our annual revenue is less than $100.0 million during the most recently completed fiscal year and our voting and non-voting common stock held by non-affiliates is less than $700.0 million measured on the last business day of our second fiscal quarter.

Current wording

We are also a “smaller reporting company” as defined in the Exchange Act. We may continue to be a smaller reporting company even after we are no longer an emerging growth company. We may take advantage of certain of the scaled disclosures available to smaller reporting companies until for so long as either (i) our voting and non-voting common stock held by non-affiliates is less than $250.0 million measured on the last business day of our second fiscal quarter, or (ii) our annual revenue is less than $100.0 million during the most recently completed fiscal year and our voting and non-voting common stock held by non-affiliates is less than $700.0 million measured on the last business day of our second fiscal quarter. Based on the aggregate market value of our common stock and Class A common stock held by non-affiliates as of June 30, 2026, we expect to lose our smaller reporting company status effective January 1, 2027. As such, we will be required to comply with certain requirements that are currently inapplicable to us as a smaller reporting company but are not exempt under our emerging growth company status, including the quantitative market risk disclosures required by Item 305 of Regulation S-K.